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Corporate Constitutional “Rights” Harm Small Business

Laura Bonham

On the day, nearly twenty years ago, that my husband and I incorporated our general contracting firm to protect ourselves against liability, I first became aware of corporate personhood. It was not lost on me that protection from liability was a huge advantage that people just don’t have, and how ridiculous it was that my husband and I had to incorporate to get that protection. To my amazement, I discovered that our recently incorporated business was entitled to all kinds of Constitutional rights and privileges, and that big, powerful, and rich corporations exercised those rights frequently, especially in the courts.

Over time, the Supreme Court has made numerous decisions, including Citizens United, which has enshrined (so-called) corporate “rights” in the Constitution. It is one thing for corporations to have legal privileges that enable them to participate in a secure economy, and another thing all together to bestow upon them the Constitutional rights and protections that otherwise only belong to living breathing human beings.

It was once suggested to me that because it is relatively inexpensive and easy to incorporate, Americans should just incorporate themselves individually—then we would all have the same rights and privileges as corporations. Interesting thought, but the fact is that even though small, incorporated businesses can technically claim Constitutional rights, the reality is that these small businesses are trumped by the treasuries of large multi-national corporations, which currently share the same rights and can afford long litigation.

Time and again, large corporations have gone to court to assert their rights over the rights of small businesses. In nearly every case, the Court has sided with the large corporations, most recently in American Express v. Italian Colors Restaurant. From The New York Times:

On June 20, the court again restricted class actions, in American Express v. Italian Colors Restaurant. The restaurant and other small businesses had brought a class-action suit accusing American Express of violating antitrust law in imposing excessive fees on merchants. The individual plaintiffs could have each recovered just $38,000 under the antitrust statute, but proving an antitrust violation would have cost exponentially more. Therefore, denying a class action meant that the suit could not realistically go forward. The result: a company can violate antitrust law yet immunize itself from liability through an arbitration clause.

Small businesses find themselves in the same position when it comes to our First Amendment “right” to participate in the electoral process.  We simply do not have the funds to compete against the big boys. A body that should be protecting the interests of small businesses, the US Chamber of Commerce is overrun with the very same corporations who are exercising their personhood “rights” to slap down any business which challenges their policies, and frequently lobbies for laws and supports candidates who will support their corporate agenda.

The relationship of the small business to its customers is entirely different than the relationship between customers and large corporations. Small businesses enjoy success because we are based in a community of which we are a part, producing not only goods and services, but providing employment and feeding the tax base. Small businesses strive to meet the needs of our customers, identify strongly with the people we serve, and share the same plight our customers do – our children go to local schools, we breathe the local air, we use local services funded by our tax dollars, etc.

Big corporations have used the Fourteenth Amendment due process and equal protection clauses to oppose tax and other public policies meant to protect local communities, and to bypass local planning codes designed to encourage small business and strengthen local economies in forcing construction of chain stores against the will of the community. They have used Fourth Amendment search and seizure rights to avoid subpoenas for unlawful trade and price fixing, and to prevent citizens, communities and regulatory agencies from stopping corporate pollution and other assaults on people or the commons.  Modern corporate personhood rights have deleterious effects on small businesses and the communities on which we depend.

It is clear that when large corporations have special privileges of limited liability to protect commerce and inherent rights under the Constitution, those rights and privileges are used to smash the rights of the people, including the owners of small businesses. Small businesses would do well to get behind efforts to amend the Constitution to clearly state that corporations are not entitled to inherent human rights and that money is not protected political speech so we may enjoy, in the future, a more level playing field in which to do business. Learn more at and join me in endorsing this here.

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Laura Bonham

Laura Bonham

Laura Bonham is a member of Move to Amend’s National Leadership team and a contributing wordsmith in Move to Amend’s communication department. She is a community organizer, former candidate for state office, and a small business owner.

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